Question 1

For shareholders to act during a meeting, a proxy must be presented.

Accepted Answer

A) True 
 B)False

Question 2

A breach of fiduciary duties by those who own a close corporation normally constitutes what is known as oppressive conduct.

Accepted Answer

A) True 
 B)False

Question 3

Tech Talent Inc. is a corporation. Its implied powers enable it to

Accepted Answer

A)   avoid paying income taxes on foreign income.
B)   depart significantly from traditional corporate formalities.
C)   act beyond the authority given to it under its charter.
D)   borrow funds, lend funds, and extend credit.E) A) and C)
F) A) and D)

Question 4

Fact Pattern 29-1 Don is a shareholder of Energy Renew Inc. When the directors fail to undertake an action to redress a wrong suffered by the firm, Don files a suit on its behalf.
Refer to Fact Pattern 29-1. Any damages recovered by the suit will go to the firm's

Accepted Answer

A)   shareholders, excluding Don.
B)   treasury.
C)   directors.
D)   shareholders, including Don.E) None of the above
F) B) and D)

Question 5

Adam is a shareholder of Bay Boats Inc. with preemptive rights. With these rights, he can

Accepted Answer

A)   buy a prorated share of a new issue of stock before other buyers.
B)   choose to have the firm act exclusively in a certain area.
C)   preempt managerial decisions that affect shareholders.
D)   sell a prorated share of a new issue of stock before other sellers.E) A) and B)
F) None of the above

Question 6

The acquisition of a share of stock makes a person a shareholder, but not an owner, of a corporation.

Accepted Answer

A) True 
 B)False

Question 7

If the procedures for incorporation are not followed precisely , others may be able to challenge the existence of the corporation.

Accepted Answer

A) True 
 B)False

Question 8

Corporate bylaws and resolutions of the corporation's board of directors provide guidelines but cannot grant or restrict corporate powers.

Accepted Answer

A) True 
 B)False

Question 9

A benefit corporation is designed to make a profit and maximize the benefit to shareholders.

Accepted Answer

A) True 
 B)False

Question 10

Harry and Ilene want to market a new line of camping gear as a corporation-Journeys Inc. To avoid income taxes at the corporate level, they should form

Accepted Answer

A)   an alien corporation.
B)   a foreign corporation.
C)   an S corporation.
D)   a benefit corporation.E) A) and D)
F) A) and C)

Question 11

Brad is a shareholder of Cloud Servers Inc. He will be deemed to have a fiduciary duty to Cloud and its minority shareholders if he has a sufficient number of shares to

Accepted Answer

A)   assert a preemptive right.
B)   bring a shareholder's derivative suit.
C)   exercise actual control over the corporation.
D)   participate in a cumulative vote.E) All of the above
F) A) and C)

Question 12

Fact Pattern 29-1 Don is a shareholder of Energy Renew Inc. When the directors fail to undertake an action to redress a wrong suffered by the firm, Don files a suit on its behalf.
Refer to Fact Pattern 29-1. Don's suit is

Accepted Answer

A)   a preemptive right.
B)   a shareholder's derivative suit.
C)   the duty of a majority shareholder.
D)   unethical and illegal.E) C) and D)
F) All of the above

Exam 29: Formation and Ownership of a Corporation

Adam is a shareholder of Bay Boats Inc. with preemptive rights. With these rights, he can

Correct Answer
verified

Corporate bylaws and resolutions of the corporation's board of directors provide guidelines but cannot grant or restrict corporate powers.

Correct Answer
verified

The acquisition of a share of stock makes a person a shareholder, but not an owner, of a corporation.

Correct Answer
verified

Fact Pattern 29-1 Don is a shareholder of Energy Renew Inc. When the directors fail to undertake an action to redress a wrong suffered by the firm, Don files a suit on its behalf. Refer to Fact Pattern 29-1. Don's suit is

Correct Answer
verified

If the procedures for incorporation are not followed precisely , others may be able to challenge the existence of the corporation.

Correct Answer
verified

For shareholders to act during a meeting, a proxy must be presented.

Correct Answer
verified

A breach of fiduciary duties by those who own a close corporation normally constitutes what is known as oppressive conduct.

Correct Answer
verified

Fact Pattern 29-1 Don is a shareholder of Energy Renew Inc. When the directors fail to undertake an action to redress a wrong suffered by the firm, Don files a suit on its behalf. Refer to Fact Pattern 29-1. Any damages recovered by the suit will go to the firm's

Correct Answer
verified

Tech Talent Inc. is a corporation. Its implied powers enable it to

Correct Answer
verified

Brad is a shareholder of Cloud Servers Inc. He will be deemed to have a fiduciary duty to Cloud and its minority shareholders if he has a sufficient number of shares to

Correct Answer
verified

A benefit corporation is designed to make a profit and maximize the benefit to shareholders.

Correct Answer
verified

Harry and Ilene want to market a new line of camping gear as a corporation-Journeys Inc. To avoid income taxes at the corporate level, they should form

Correct Answer
verified

Exam 29: Formation and Ownership of a Corporation

Adam is a shareholder of Bay Boats Inc. with preemptive rights. With these rights, he can

Correct AnswerverifiedShow Answer

Corporate bylaws and resolutions of the corporation's board of directors provide guidelines but cannot grant or restrict corporate powers.

Correct AnswerverifiedShow Answer

The acquisition of a share of stock makes a person a shareholder, but not an owner, of a corporation.

Correct AnswerverifiedShow Answer

Fact Pattern 29-1 Don is a shareholder of Energy Renew Inc. When the directors fail to undertake an action to redress a wrong suffered by the firm, Don files a suit on its behalf. Refer to Fact Pattern 29-1. Don's suit is

Correct AnswerverifiedShow Answer

If the procedures for incorporation are not followed precisely , others may be able to challenge the existence of the corporation.

Correct AnswerverifiedShow Answer

For shareholders to act during a meeting, a proxy must be presented.

Correct AnswerverifiedShow Answer

A breach of fiduciary duties by those who own a close corporation normally constitutes what is known as oppressive conduct.

Correct AnswerverifiedShow Answer

Fact Pattern 29-1 Don is a shareholder of Energy Renew Inc. When the directors fail to undertake an action to redress a wrong suffered by the firm, Don files a suit on its behalf. Refer to Fact Pattern 29-1. Any damages recovered by the suit will go to the firm's

Correct AnswerverifiedShow Answer

Tech Talent Inc. is a corporation. Its implied powers enable it to

Correct AnswerverifiedShow Answer

Brad is a shareholder of Cloud Servers Inc. He will be deemed to have a fiduciary duty to Cloud and its minority shareholders if he has a sufficient number of shares to

Correct AnswerverifiedShow Answer

A benefit corporation is designed to make a profit and maximize the benefit to shareholders.

Correct AnswerverifiedShow Answer

Harry and Ilene want to market a new line of camping gear as a corporation-Journeys Inc. To avoid income taxes at the corporate level, they should form

Correct AnswerverifiedShow Answer

Correct Answer
verified

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verified

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